Germany discount retail giant Aldi has reportedly begun selling a small number of branded products in its domestic market, making a change from its traditional focus on cheaper private-label brands.
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Italian confectioner Ferrero told the Financial Times that the company is supplying seven chocolate products, including Ferrero Rocher and Kinder Surprise, to the German discount retailer.
Aldi’s hard discount strategy has previously focused on own-brand products; however, soft-discounter Lidl, Aldi’s closest rival, has grown its sales since it began selling a number of branded products.
“I think Aldi now is in the bit of a dilemma around their business model,” Clayton Daley, chief financial officer of consumer goods giant Procter & Gamble, told the FT recently. “Can they stay 100% private-label when the soft-discount format right now is winning?”
A move by Aldi to sell branded products could represent a major opportunity for branded consumer goods companies such as P&G.
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